Housing Bubble, credit bubble, public planning, land use, zoning and transportation in the exurban environment. Specific criticism of smart growth, neotradtional, forms based, new urbanism and other top down planner schemes to increase urban extent and density. Ventura County, California specific examples.

Tuesday, May 19, 2009

5.6x

I love the C.A.R. They provide no end of amusement. Take this recent press release.

Entry-level housing affordability reached 69 percent

For release:Thursday, May 14, 2009

Quick Facts:· C.A.R. First-time Buyer Housing Affordability Index stood at 69 percent in the first quarter of 2009 compared with 46 percent (revised) in the first quarter of 2008· The median price of an entry-level home in California was $213,040 in the first quarter of 2009· The estimated monthly payment including taxes and insurance was $1,270 in the first quarter of 2009· The minimum household income needed to purchase an entry-level home in California in the first quarter of 2009 was $38,090

Let's do that math. $213k/$38k is a gross multiplier of 5.6. They assume a 10% down so the debt multiplier is 5.0. Whatever happened to 2.5-3 times your gross? Never mind, moving on. The $192k mortgage at prevailing rates 5% per bankrate is $1050. Taxes in California @1.3% are $230. Apparently PMI and insurance are free in CARworld™. And that $1280/mo relative to the gross monthly take home pay of $3174/mo? 40%. Am I so old that I remember 28%?

12 comments:

$1280 a month for a housing payment? I can only dream of what that might be like. Here in D.C., $1280 a month covers the payment on the front closet.

(But I have to give them credit for using realistic numbers--$38k is much more likely to be the actual houshold income for a first-time buyer than the $120k++ numbers that real estate professionals sometimes kick around, as if every family were two working professionals with college degrees.)

Anyone want to guess where Serin's coming up with the money to buy an RV, a second van (!!), all while renting his own studio apartment in downtown Sacramento *and* supposedly chiseling away at his debts?

Surely the two-bit operation he's "working" for can't be paying him that well...

PV,Went to a land auction 2 weeks ago. Auctioneers wife was a realtor.I mentioned we still have quite a drop ahead here in the high end. Blank look. So I ask her what the Charlotte County median HOUSEHOLD income is...she didn't have a clue.

So I told her. 33K. Most likely less since the implosion.

The look I got was priceless. It is gonna be a long,hot summer here in FL. Oh,prices will continue to crash.

I found out after arriving the auction was not an "Absolute". Owner had 24hrs. to reject the high bid. He did. 23K. This lot started at 175K on the MLS. Now listed at 46K. I think the cash out refi is in the 140ish range.It is realistically worth 12-15K.

Aren't you going to do an election special Rob ? I'm listening to John & Ken on KFI online as they do their special hour - ahhh fond memories of those two, well just one of them, liberto-anarchist loons.

I cannot believe that the state of California is paying for my coworker to have bonding time with his f-ing latest kid! Nothing against the guy personally, but that is pretty f-ed up considering the situation on our hands - oh, and his wife only marginally works on occasion.